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Molina (MOH) Up 3.5% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Molina (MOH - Free Report) . Shares have added about 3.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Molina due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Molina Healthcare Misses on Q2 Earnings, Hikes '21 View
Molina Healthcare reported second-quarter 2021 adjusted earnings of $3.40 per share, missing the Zacks Consensus Estimate by 2.1%. Moreover, the bottom line declined 29% year over year due to higher expenses.
Total operating revenues of $6.8 billion beat the consensus mark by 6.7%. The top line rose 47.2% year over year on increased membership and higher premium revenues.
Quarterly Operational Update
The company’s net income totaled $185 million, down 33% year over year due to the impact from the net effect of COVID-19 on the second quarter.
Premium revenues for the company increased 51% year over year on the back of better organic membership in Medicaid, Medicare and Marketplace along with the positive effect of acquisitions that closed in the second half of last year.
Total operating expenses shot up 55.6% year over year to $6.5 billion due to higher medical care costs, general and administrative expenses, and premium tax expenses. Molina Healthcare’s interest expenses climbed 25% year over year to $30 million.
Total membership under Government Program at the end of the second quarter stands at 4.7 billion, up 32% year over year.
Financial Update (as of Jun 30, 2021)
Molina Healthcare’s cash and cash equivalents jumped 10.9% to $4.6 billion from the level at 2020 end. Total assets rose 10.5% from the level at 2020 end to $10.5 billion.
The company’s shareholder equity improved 13.1% from the figure at 2020 end to $2.3 billion.
Net cash flow provided by operating activities stood at $1 billion at the end of the second quarter, up 40.2% year over year.
2021 Guidance
Following second-quarter results, the company raised its outlook for 2021. Premium revenue growth is projected to be more than $25 billion, higher than the previous guidance of $24 billion. Adjusted EPS is estimated to be no less than $13.25 per share compared with the prior guidance of no less than $13.
Total revenues for 2021 are anticipated to be above $26 billion, up from the prior outlook of $25 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Molina has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Molina has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Molina (MOH) Up 3.5% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Molina (MOH - Free Report) . Shares have added about 3.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Molina due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Molina Healthcare Misses on Q2 Earnings, Hikes '21 View
Molina Healthcare reported second-quarter 2021 adjusted earnings of $3.40 per share, missing the Zacks Consensus Estimate by 2.1%. Moreover, the bottom line declined 29% year over year due to higher expenses.
Total operating revenues of $6.8 billion beat the consensus mark by 6.7%. The top line rose 47.2% year over year on increased membership and higher premium revenues.
Quarterly Operational Update
The company’s net income totaled $185 million, down 33% year over year due to the impact from the net effect of COVID-19 on the second quarter.
Premium revenues for the company increased 51% year over year on the back of better organic membership in Medicaid, Medicare and Marketplace along with the positive effect of acquisitions that closed in the second half of last year.
Total operating expenses shot up 55.6% year over year to $6.5 billion due to higher medical care costs, general and administrative expenses, and premium tax expenses. Molina Healthcare’s interest expenses climbed 25% year over year to $30 million.
Total membership under Government Program at the end of the second quarter stands at 4.7 billion, up 32% year over year.
Financial Update (as of Jun 30, 2021)
Molina Healthcare’s cash and cash equivalents jumped 10.9% to $4.6 billion from the level at 2020 end. Total assets rose 10.5% from the level at 2020 end to $10.5 billion.
The company’s shareholder equity improved 13.1% from the figure at 2020 end to $2.3 billion.
Net cash flow provided by operating activities stood at $1 billion at the end of the second quarter, up 40.2% year over year.
2021 Guidance
Following second-quarter results, the company raised its outlook for 2021.
Premium revenue growth is projected to be more than $25 billion, higher than the previous guidance of $24 billion. Adjusted EPS is estimated to be no less than $13.25 per share compared with the prior guidance of no less than $13.
Total revenues for 2021 are anticipated to be above $26 billion, up from the prior outlook of $25 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Molina has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Molina has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.